Ministry of Foreign Affairs and Trade

Railways are being afforded precedence within transport development

September 13, 2018 2:41 PM

“Railways are being afforded precedence within transport development”, Minister of Foreign Affairs and Trade Péter Szijjártó declared at the Hungrail Hungarian Rail Association Conference in Budapest.

“A budget of 1500 billion forints (EUR 4.6bn) is available until 2022 for the development of Hungarian railways”, Mr. Szijjártó stated.

The Minister told those present that the Government is in intensive negotiations with China’s export-import bank on the conditions of the loan agreement relating to the construction of the Budapest-Belgrade high-speed railway line. “We have come to an agreement with respect to interest rate, the loan period and the currency, but various issues such as the availability fee remain the subject of discussion. Our common target with the Chinese party is for negotiations on the financial terms and conditions to come to a close before the end of this year”, he noted.

Mr. Szijjártó said that 30 enterprises had requested the tender documentation concerning the technical execution of the Budapest-Belgrade railway line, which indicates the high level of market interest. “Of these, two consortia are suitable for making a final bid, and the result is expected to be published in November, and a contract will be concluded with the winning applicant prior to the end of the year”, he told reporters. “Planning and licencing work can begin early next year to ensure that the construction of the Budapest-Belgrade high-speed railway line is completed by 2023”, he noted.

The Foreign Minister highlighted the fact that Chinese companies ship the majority of the goods destined for the western half of Europe via the Port of Piraeus in Greece, and without the renovation of the railway line Hungary would be left behind in the competition for transport routes. Mr. Szijjártó recalled that the prime ministers of the Visegrád Group (V4) countries had agreed on the establishment of a regional high-speed rail network. The feasibility studies relating to the high-speed railway line connecting Budapest and Warsaw should be complete within a year. “Based on professional consensus, the development project should reduce travel time between the two capitals to just four hours, as a result of which the railway line will be able to compete with even air transport”, he added.

Mr. Szijjártó also spoke about plans to construct a high-speed railway line between Budapest and Kolozsvár (Cluj-Napoca), within the framework of a comprehensive development strategy, the route of which would be extended to Bucharest by the Romanians. The tender for the preparation of the feasibility study relating to the Hungarian stretch of the railway line is expected to be published soon. “Hungary would like to devote significant resources towards increasing border permeability capacity and the establishment of new border crossing points”, the Minister said, noting that negotiations are underway with the Slovakian Government on the renewed exploitation of nine existing rail border crossing points. For lines currently enable freight transport and three public transport. As an example, he mentioned that a rational timetable would enable the better exploitation of the railway line connecting Komárom and Révkomárom (Komárno) for carrying passengers.

Mr. Szijjártó also spoke about the fact that in Hungary passenger transport realised 600 million euros in commercial turnover last year, and 310 million euros during the first half of this year, which represents a year-on-year increase of 6 percent. “Last year, 340 million euros in exports were shipped via rail, an increase of 9 percent, and this index reached 170 million euros during the first half of this year, representing a year-year increase of 4 percent”, he said. “Hungary came in at 31st place in this year’s logistics rankings published by the World Bank, a significant improvement from 51st place in 2010”, he noted.

“Important trade routes traverse Hungary; we must exploit this opportunity, but must also recognise that there is a huge level of regional competition”, Mr. Szijjártó stressed. The Minister told reporters that direct air passenger routes have once again been established between Budapest an North America, and between Budapest and the Balkan capitals. “Negotiations with Polish airline LOT are also in an advanced stage with relation to the establishment of a base in Budapest, enabling the filling of the void left by the bankruptcy of Hungarian state airline Malév”, the Minister said. “The Government’s goal is for the motorway network to reach every part of the country”, he reminded the press.

Deputy State Secretary for Transport Péter Tóth from the Ministry of Innovation and Technology highlighted the economic importance of Hungarian railways, including the fact that the 48 Hungarian companies with railway licences employ a total of some 60 thousand people. “The annual turnover of Hungary’s rail companies exceeded 600 billion forints (EUR 1.85bn) in 2017, and the sector transports an average of 150 million passengers and 52 million tons of goods each year”, he told the press. “Since 2010, the Hungarian Government has been handling public transport as one of the engines of economic development, and the backbone of public transport continues to be rail”, he added. Rail sector awards were presented at the conference, including the István Sipos Award, which was presented to Miklós Kopp, former Freight Transport Director of the International Federation of Railways and CEO of Záhony-Port Plc.